With Android running just fine on an iPhone, the next logical step would be something like Android for iPod touch—and it totally is! Coming soon: Android for iPod touch.
The hack is brought to you by the same chaps that did the initial Android on iPhone ditty back in early May. No exact date is given for the release, although the Linux for iPhone guys seem to think it (the binaries) will arrive at the same time as Android for iPhone 3G. [Linux for iPhone via Redmond Pie]